Kazakh economy slows in April

KAZAKHSTAN - In Brief 17 May 2024 by Evgeny Gavrilenkov

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The Bureau of National Statistics reported that the short-term indicator that measures monthly economic activity and aggregates monthly trends in the industry, agriculture, construction, transportation, trade, and IT/communications was up by 3.9% y-o-y in 4M24. As in January, 2M24, and 1Q24, it grew by 4.3%, 5.2%, and 4.7% y-o-y economic growth decelerated sharply in April. Note that in the case of this indicator, the Bureau refrains from reporting m-o-m and y-o-y data for single months and prefers to publish only cumulative y-o-y data for incremental periods. Therefore, monthly economic dynamics remain somehow obscured. Looking at statistics for particular sectors of the economy reveals that industrial production grew by 1.4% y-o-y in April, which brought the growth of the 4M y-o-y tally to a mere 3.2% y-o-y. The mining segment contracted y-o-y in April by 1.3%, but it was still up by 1.1% y-o-y in 4M24. Oil extraction was down y-o-y in both periods. As metal ores mining was up by 4.1% and 6.5%, the metallurgical industry grew by 7.4% and 5.1% (all numbers as y-o-y for April and 4M24). Food production was down, while the machine-building segment continued to grow. It looks as though an excessively strong tenge made the production of foodstuffs less competitive. However, the machinery and technological segments supported by incoming foreign investments appear less sensitive to the tenge strength. Nonetheless, in 4M24, total investments in production capacity shrank by 5.3% y-o-y despite a 19.9% y-o-y increase in manufacturing. In the mining segment, they contracted by 28.3% y-o-y, and in agriculture – by 31.1 y-o-y. Even though investment statistics are very volatile a...